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How scam binary brokers make money

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Scam brokers make money by scamming people, obviously. A fair broker could make profit, but for some, that’s not enough so scam brokers get down and dirty, doing everything possible to part you from your money.

Their most useful tool is the Account Manager - not all of them, just the ones who trade your money away. It usually works like this: the account manager greets you and assures you he (or she) is a veteran trader and that he is here to turn your 300 bucks into 3,000 by the end of the week. But… hold on… you need to deposit some more money, and then he will give you a bonus of 100%. Then, he will multiply your money tenfold, and then he will make you a VIP member and a personal concierge will give you a backrub.

This is before you deposit. After is another story: your account manager is not the expert you thought him to be. The account balance is slowly going down under his “careful” supervision, and when you decide you want to withdraw whatever’s left, he informs you that you cannot because you’ve accepted a bonus and you haven’t yet reached the turnover. The money you lose “in the market” goes into the brokerage’s pockets and that’s a way (maybe the most common) for them to make money. There are others, of course.

When you ask for a withdrawal, the broker completely ceases any communication with you. No one answers the phone or replies to your emails.

The broker offers free signals. These are either designed to make you lose on purpose or the signal providers lack the necessary knowledge to trade profitably. The result is the same in both cases: you lose; the broker wins.

The broker works with scam auto-traders and binary options robots (you know, the ones that allegedly make you a millionaire overnight). The software is offered for free, but of course, it trades your account into the ground.
These are just some ways scam brokers make money, so keep your eyes open because there are others.

Comments

POSH's picture

I never seen my other traders who make fortunes with auto trade or robots. They are all rubbish!!

In case of deposit bonus, some broker clearly mention the withdrawal condition which is fair however, the scam brokers do not explain about withdrawal. They only tell us Get 100-200% free bonus! and get more profits!!

Please be aware with those broker and they are usually unregulated.

POSH
LynnJohn's picture

Binary options scam brokers are sometimes hard to distinguish from good binary brokers, but it is not impossible.

LynnJohn